Accenture offers 7-month severance payout to staff

BENGALURU: Accenture is offering a seven-month severance payout to employees impacted by its latest layoffs. The package is high considering most companies offer a two-three months’ payout, or one month of salary for every year of service put in.

The package is applicable to employees voluntarily tendering resignations. The payout includes a three-month salary in lieu of the notice period and an additional fourmonth salary for those who resign voluntarily, sources said.

TOI wrote last month that Accenture is laying off 5% of its global workforce. India has two lakh of its five lakh employees, and 5% of that would mean 10,000 employees. An Accenture spokesperson said at the time: “This year, across all parts of our business and all career levels, we will identify approximately 5% of our people as our lowest performers, and these individuals will transition out of Accenture. This is consistent with our actions each year.”

Performance not main consideration for layoffs
TOI spoke to some employees who said performance was not the consideration in several cases. Accenture did not respond to questions on this matter till the time of going to print. A number of technology companies are laying off people in areas they have less business in, while hiring in areas of demand, such as new digital technologies. Last month, Accenture had said that in India, they are contin-

A number of technology companies are laying off people in areas they have less business in, while hiring in areas of demand, such as new digital technologies

uing to hire. But it did not disclose in which areas the hiring is happening.

Accenture, like others in the IT industry, has seen revenue growth collapse following the Covid-19 pandemic. In the last quarter, revenue grew a mere 1.3%. Hansa Iyengar, principal analyst at Omdia, said it’s all about tighter control on costs. “Accenture still has 70% of revenue coming from ‘the New’ that is all digital and as such it expects to be on the lower end of its guidance. No surprise there. As long as the pandemic draws on it is going to hurt every enterprise and that will impact the service providers.”

Iyengar said different geographies follow different severance laws. “In the US, the employment is ‘at will’ where the employer is under no obligation to pay severance. In the UK, severance is usually one month for every year served in the company. In South Africa and South-East Asia, it’s 15 days per year served.”

In Cognizant’s previous round of layoffs, employees were offered severance packages of 12 to 21 weeks’ pay, depending on years of experience, and one week’s pay for every year of service.